South China Resources exploration activity for the Danfeng Project in China has been promising and the company has now begun modelling the copper mineralization.

During last year, South China Resources completed major exploratory work at the Danfeng copper and molybdenum project. SRK Exploration Services is auditing the drilling, handling and assaying of copper and molybdenum in diamond drill core and underground channel sampling at the Danfeng Project.

Danfeng's good copper grades are correlating well with previous Chinese drilling at the site.

The company believes that given the structural complexities there is very limited potential for the project to sustain a bulk tonnage, high-grade molybdenum mine at the current level of geological understanding.

South China Resources is modelling the copper mineralisation to obtain an understanding of the geometry of that mineralisation and to perform some studies to determine the economics of mining this as a single product. The board will make a determination on this in the coming months.

The granted licence ensures the company can continue working with its joint-venture partner to investigate the potential to develop a modest, but scalable copper mining operation.

On December 31, South China Resources received a two year extension on its Danfeng Project exploration licence.

Meanwhile, in Tibet, South China Resources 53%-owned Zhunuo Copper Project represents a potential world class prospect and a significant asset for the company.

The Zhunuo Copper Project is a porphyry copper project at an early stage of drill and adit exploration. Results of exploration to date indicate it is a moderate to high-grade porphyry copper resource with the potential to become a significant deposit in the Gangdese metallogenic belt of Tibet.

South China Resources continues to search for new opportunities with its strategic Cooperation Agreement with the Xi'an Institute of Geology and Mineral Resources. The Cooperation Agreement specifies a right to acquire a 85% interest in any joint venture established by the parties. Current activities include the joint evaluation of an area of interest in the highly prospective East Qinling Mountain Belt, covering an area of interest of approximately 206.73 sqkm. Previous exploration has identified significant coincident copper and molybdenum geochemical anomalies in the area of interest, which is located 14km along strike from the word class Jinduicheng molybdenum mining complex. The company greatly values the alliance with a highly respected central government controlled geological and mineral research institute.